How much would reconfinement cost the economy and public finances

Impact on activity

According to several economists interviewed by AFP, a one-month lockdown, with a level of restrictions broadly similar to that observed in November, would cut the gross domestic product (GDP) by around one point, or just over 20 billion. euros, over the year.

Knowing that the curfew is already penalizing activity, "the first quarter will certainly be a quarter of recession", argues Ludovic Subran, chief economist of the insurer Allianz.

According to the Ministry of the Economy, confinement could lead to a monthly loss of activity ranging from 10 to 18% compared to the level before the crisis. In November, activity had fallen by 12% from its level at the end of 2019 and in April, by more than 30%.

The Minister of the Economy Bruno Le Maire also acknowledged Wednesday that in the event of new restrictive measures, "of course, we will have a growth which could not reach 6% in 2021", as foreseen for the moment the government.

New expenses and revenue losses

Currently, with the curfew at 18:00 p.m., "the aid costs the State approximately 6 to 7 billion euros per month", an amount to which must be added the loss of tax revenue, which leads to more than 10 billion euros. 'euros, according to the LREM deputy and general rapporteur for the budget to the Assembly Laurent Saint-Martin.

"In confinement, if we are on the format of last November, it will probably cost even more expensive (...) it can approach 15 billion euros all expenses and non-resources combined", he said. he claimed on Radio J last Sunday.

The three main support measures put in place by the government are the solidarity fund for businesses, support for short-time working and exemption from charges.

For the month of November, for example, the government spent more than 4 billion euros for the solidarity fund, and the addition could rise further because companies have until January 31 to apply.

Short-time work affected 3,1 million employees in November for an amount of 2,3 billion euros, according to figures from the Dares.

To this can be added possible additional aid to support the sectors which remain very affected by the crisis. Bruno Le Maire thus spoke on Wednesday in the Senate of the possibility of converting certain loans guaranteed by the State into subsidies, if Brussels gives the green light.

How the State will finance this aid

The government has been "far-sighted" in 2020, Bruno Le Maire has repeatedly said. In fact, of the budget planned to finance aid, 28,8 billion euros were not spent last year. This envelope is therefore available for this year, even if around 9 billion have already been pre-empted to finance the aid allocated for 2020, but which has not yet been paid.

Last week, the minister had indicated that in a constant health situation, the government could "hold out for three and a half months" without needing to replenish the 3 budget.

But in the event of re-containment, it will be necessary to go through a corrective finance bill.

It could occur "probably at the end of the first quarter (...) at the end of March-beginning of April, but it can be accelerated according to the needs", according to Laurent Saint-Martin.